OMB identifies up to $800 billion in benefits from regulations since 2002

Released in recent days with little fanfare, the OMB’s 16th annual report to Congress summarizes the known costs and benefits of major rules – those that carry an economic impact of at least $100 million in a given year.

The aggregate benefits of rules for which agencies were able to calculate and monetize both costs and benefits falls somewhere between $193 billion and $800 billion, according to the 121-page report.

The total cost of those rules is estimated at somewhere between $57 billion and $84 billion.

The report, which can be accessed here, also breaks down regulatory costs and benefits by agency.

However, the report acknowledges its own limitations. Among them are rules put forth by the Commodities Futures Trading Commission (CFTC), the Securities and Exchange Commission (SEC) and other independent agencies whose rules are not subject to OMB review.

Independent regulatory agencies finalized 21 major rules last year alone, according to the report.

Also problematic is that the costs and benefits are often impossible to quantify. For example, it is difficult to put a dollar value on privacy lost to new disclosure requirements or on an unknown number of lives saved by a worker safety rule.

Finally, agencies use varying methodology to determine the good and bad consequences of new rules, the report found.

“Individual regulatory impact analyses vary in rigor and may rely on different assumptions, including baseline scenarios, methods, and data,” a section of the report reads.

The report lays out recommendations meant to reform the regulatory process. It calls for agencies to endeavor to use plain language, rather than legal jargon, so that the private sector and general public can understand the purpose of new regulations and how they are to be implemented. It also urges the use of “evidence-based” data to calculate costs and benefits, and the establishment of a uniform system to analyze the merit of new rules.